Aaron's cuts its fiscal 4Q, 2013 forecasts
ATLANTA (AP) — Aaron's is lowering its fiscal fourth-quarter and 2013 outlooks partly because of tough economic conditions facing its shoppers.
The retailer's stock fell more than 7 percent in morning trading Monday.
Aaron sells and leases furniture, consumer electronics, home appliances and accessories. Chairman and President Ronald Allen said in a statement that the company's low- to middle-income shoppers are still dealing with difficult economic conditions. Product shipments to franchisees were also less in the fourth quarter than the prior-year period, he added. Sales at company-run stores open at least a year slipped.
The company now foresees quarterly earnings of 27 cents to 31 cents per share on revenue of about $555 million. Its previous outlook was for earnings between 38 cents and 42 cents per share on revenue of $575 million.
The company's revenue forecasts exclude revenue of franchisees.
Analysts surveyed by FactSet expect fourth-quarter earnings of 40 cents per share on revenue of $575.2 million.
For 2013, Aaron's now predicts adjusted earnings of $1.84 to $1.88 per share on revenue of approximately $2.24 billion. Previously the company forecast adjusted earnings of $1.95 to $1.99 per share on revenue of $2.26 billion.
Wall Street is looking for earnings of $1.97 per share on revenue of $2.26 billion.
CEO Allen said business trends aren't expected to dramatically improve near term.
Going forward, Aaron's anticipates fiscal 2014 earnings of $1.80 to $2 per share. Revenue is expected to be about $2.3 billion.
Analysts predict earnings of $2.17 per share on revenue of $2.37 billion.
Shares of Aaron's Inc. declined $2.15, or 7.4 percent, to $26.80 in morning trading.
The company expects to report its final fourth-quarter and full-year financial results on Feb. 7.